Sunday, May 31, 2015

District Attorneys Call Uber, Lyft, And Sidecar A Continuing Threat To Consumers

Bad news hit the desks of ride-share company execs this week: The district attorneys of S.F. and L.A. have teamed up to investigate Uber, Lyft, and Sidecar for a handful of practices that they assert are in violation of state law. It's the latest in a series of hurdles the companies have faced in gaining legal recognition for providing the service of taxis while insisting that they are not really taxis.

As the Chronicle and others are reporting, the two DAs' offices sent the letters on September 24th promising injunctive relief and civil penalties if the companies did not change certain policies and practices "quickly." At issue are several problems with safety and fairness that have mostly been talked about before, and the DAs call these four issues in particular "a continuing threat to consumers and the public."

The case of UberX driver Daveea Whitmire — the 28-year-old driver with a criminal record (including prison time) who's been charged in an assault on a passenger last November — plays a starring role in this current kerfuffle. S.F. DA George Gascon says he wants all three companies to "remove all statements from their mobile apps, websites and other publications that imply their background checks reveal drivers’ complete criminal history," calling such claims "patently untrue." (You may recall that Uber contracted with a company called Hireaseto do their background checks, and that company either failed to check on Whitmire or somehow missed his previous felonies.)

There's the much discussed issue of Uber, Lyft, and Sidecar's lacking the proper licenses to pick up and drop off passengers at airports.

Recently launched carpool options, including UberPool, are illegal as we heard a few weeks ago, and the DAs are saying these have to cease immediately. Under state law, the cost of all taxi fares must be split evenly between passengers sharing a single ride unless the company is a "passenger stage corporation" like SuperShuttle. UberPool allows users to share rides for cheaper fares, however the fares are not divvied up to add up to an equivalent single fare.

Also, like normal taxis, ride-share companies have to be "regulated by the state’s Department of Food and Agriculture’s weights and measures division, which regulates everything from groceries to gas stations to taxis to ensure that customers are getting the amount of food or gas or number of taxi miles they’re paying for."

There's nothing in this latest round of letters relating to the ongoing issue of ride-share drivers' and their insurance, but that seems to be getting worked out at the state level.

Sidecar CEO Sunil Paul shared the letter he received with the Wall Street Journal, saying, "We're frankly disappointed and a little baffled that there would be all of this pushback."

In a statement, Gascon says, "We value innovation and new modes of providing service to the public. However, we need to make sure the safety and well-being of consumers are adequately protected in the process.”

Have fun at that meeting with the Weights and Measures Division, kids. I hear they're a blast.